Lance Armstrong Steps Down From Livestrong And Loses Nike As Sponsor

Kurt Badenhausen
,
Forbes Staff
I cover sports business with rare dips into b-schools, local economies

(Image credit: AFP via @daylife)

Nike has made a habit of backing the tarnished sports figures on its payroll from Kobe Bryant to Tiger Woods to Joe Paterno. Lance Armstrong was one of those athletes, until now. The $25-billion-in-sales sports apparel and footwear giant announced in a statement this morning that it was dropping Armstrong from its roster of athletes. The statement reads:

"Due to the seemingly insurmountable evidence that Lance Armstrong participated in doping and misled Nike for more than a decade, it is with great sadness that we have terminated our contract with him. Nike does not condone the use of illegal performance enhancing drugs in any manner. Nike plans to continue support of the Livestrong initiatives created to unite, inspire and empower people affected by cancer."

Nike's actions come the day after a New York Daily News story implicating Nike in the Armstrong doping scandal. It cites the deposition given by Kathy LeMond, the wife of American cyclist Greg LeMond, who testified under oath that Nike paid former International Cycling Union president Hein Verbruggen $500,000 to cover up a positive drug test. Nike vehemently denied the charges.

The Nike/Armstrong relationship is a complicated one because of the Beaverton, Ore. company's support of Livestrong. It was Nike that started selling the ubiquitous yellow Livestrong bracelets with all of the money directed towards Armstrong's foundation. More than 80 million of the bracelets have been sold since they were introduced in 2004.

Nike's decision comes on the same day that Armstrong stepped down as chairman of Livestrong, the cancer fighting charity he founded in 1997 after his own cancer diagnosis in 1996. He is expected to remain on the board of directors. In a statement obtained by the Associated Press, Armstrong said: "This organization, its mission and its supporters are incredibly dear to my heart. Today therefore, to spare the foundation any negative effects as a result of controversy surrounding my cycling career, I will conclude my chairmanship."

It is the latest fallout from the damaging report released last week by the U.S. Anti-Doping Agency, which detailed allegations of widespread doping by Armstrong and his teammates while he won seven straight Tour de France titles between 1999 and 2005. The evidence includes sworn statements from 11 former teammates.

Livestrong has helped 2.5 million cancer survivors with free patient navigation services and raised nearly $500 million since its inception. It is celebrating its 15-year anniversary this weekend with a star-studded gala that is scheduled to include Norah Jones, Sean Penn, Ben Stiller and Robin Williams. Armstrong is still expected to speak at the gala.